Published 12:17 am Monday, August 25, 2025
By Kyle Penney
Benjamin Franklin once said, “An investment in knowledge pays the best interest.” As school buses rejoin the daily commute and school zones light up to protect our students, I am reminded of both the cost and the importance of education. As taxpayers, we involuntarily spend an enormous amount of money to support education through our local property taxes and various state taxes, which support local K-12 public and charter schools, junior colleges, and state universities. Taxpayers have an indirect voice in taxpayer funding of education through their elected representatives, and through periodic bond elections for specific local education projects, but the ultimate taxes collected are involuntary.
Even with all of the involuntary tax support described above, Giving USA reported that over $88 billion was voluntarily contributed to education causes in 2024, representing 14% of all charitable giving in the US. Let me review some of the many ways donors support education with charitable contributions and encourage you to find the best fit for your philanthropy.
One of the most common ways donors support education, especially higher education, is through scholarships. Donors can make contributions to a school’s general scholarship fund, direct gifts to specific program areas such as nursing or engineering, or create a named fund to honor or memorialize a loved one. In most cases, donors work directly with an educational institution’s advancement department to make sure the gift can be directed to the proper scholarship program and receive appropriate acknowledgement and recognition. In certain cases, when a donor wants to support students who are graduating from a specific high school, but they want the recipient to be able to use the scholarship at a university of their choosing, it makes sense to use an organization such as a local community foundation to create a unique scholarship fund which can achieve the donor’s specific objectives.
One of the new developments in federal tax law pertaining to scholarships is a new tax credit for contributions to scholarship granting organizations, which will become available in 2027. This new law, part of Trump’s “One, Big, Beautiful Bill” provides up to a $1,700 tax credit for individuals making contributions to nonprofit organizations which provide scholarships to private school students in grades K-12, who are from low-income families. This will encourage more charitable giving among donors who want to make K-12 private school more attainable for low-income families. Some of these scholarship granting organizations, like Ace Scholarships, already exist as tax-deductible public charities and are serving students in our community. Ace Scholarships is essentially a philanthropy-funded school choice program, but organizations like Ace will become more well-known as the State of Texas implements state-funded school choice in 2026 and the new federal tax credit takes effect in 2027.
Of course, you can still make tax deductible contributions directly to private K-12 schools and private universities to help them provide scholarships, keep tuition costs low, and maintain the faculty and facilities necessary to provide a high-quality education. Many donors support our local private schools with contributions for general support or specific projects or programs. Whether a private school is established to create a faith-based environment for families with similar values and beliefs, or established to offer a particular classroom environment or teaching style that is different than public schools, K-12 private schools and private colleges and universities are some of the primary recipients of charitable contributions. As with scholarships, private schools typically have professional advancement staff that would love to work with you to match your charitable interests with their current and long-term needs.
Finally, for the past several decades, since Texas passed the Robin Hood Plan in 1993 which effectively capped public-school spending, many public school districts have established ISD Foundations. These are charities which raise voluntary, tax-deductible contributions from local citizens and businesses to support local public schools. Most ISD foundations raise public support and make “teacher grants” in response to requests from school faculty to purchase equipment or provide programs not funded through the regular budget process. These grants support great ideas at the classroom level and engage the community in providing resources to support teaching excellence and innovation. Some ISD foundations also raise support for scholarships which are awarded to graduating seniors, encouraging the pursuit of post-secondary degrees and certifications which are vital for today’s workforce.
Whether your passion is to support cutting-edge research and discovery, world-class teaching, transformational scholarships for students with financial need, or the integration of faith and learning, making an investment in education may be your next best opportunity to Give Well.
— Guest columnist Kyle Penney is President of East Texas Communities Foundation and a Chartered Advisor in Philanthropy. To learn more about ETCF or to discuss your charitable giving, contact Kyle at 866-533-3823 or email questions or comments to etcf@etcf.org. More information is available at www.etcf.org.
